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Ramesh Inder Singh and anr. Vs. Assistant Collector, Customs and Central Excise - Court Judgment

LegalCrystal Citation
SubjectExcise
CourtPunjab and Haryana High Court
Decided On
Case NumberCriminal Miscellaneous Nos. 5596 and 5597-M of 1982
Judge
Reported in1985(4)ECC89; 1985(22)ELT712(P& H)
ActsCentral Excise Act, 1944 - Sections 9, 9(1) and 9C; Code of Criminal Procedure (CrPC) - Sections 482
AppellantRamesh Inder Singh and anr.
RespondentAssistant Collector, Customs and Central Excise
Appellant Advocate S.C. Sibal, Adv.
Respondent Advocate H.S. Brar, Adv.
DispositionPetition allowed
Cases ReferredKedar Nath Goenka v. Superintendent of Central Excise
Excerpt:
central excise - prosecution--unexplained shortage of steel ingots in factory of assessee-company--issue of summons to directors of assessee-company owning factory for unexplained shortage--no specific allegation in complaint against directors--directors cannot be held liable--central excises and salt act (1 of 1944), section 9(1). - sections 80 (2) & 89 & punjab motor vehicles rules, 1989, rules 85 & 80: [t.s. thakur, cj, jasbir singh & surya kant, jj] appeal against orders of state or regional transport authority imitation held, a stipulation regarding the period of limitation available for invoking the remedy shall have to be strictly construed. that is because any provision by way of limitation is in the nature of a restraint on the remedy provided under the act. so viewed two.....ajit singh bains, j.1. the petitioners are directors of punjab iron and steel company (pvt.) ltd., jalandhar (hereinafter called as 'the company'). shri m.s. gill, assistant collector, customs and central excise, jalandhar (respondent) filed a complaint under section 9 of the central excises and salt act, 1944 (hereafter referred to as the excise act), in which the petitioners were summoned by the judicial magistrate 1st class, jalandhar vide his order dated 27th september, 1982. hence this petition under section 482, code of criminal procedure, against the aforesaid summoning order of the magistrate.2. in fact the complaint was filed against 13 persons, including the present petitioners, who were the directors of the company. one raghubir singh was the manager of the company. the.....
Judgment:

Ajit Singh Bains, J.

1. The petitioners are Directors of Punjab Iron and Steel Company (Pvt.) Ltd., Jalandhar (hereinafter called as 'the company'). Shri M.S. Gill, Assistant Collector, Customs and Central Excise, Jalandhar (respondent) filed a complaint under Section 9 of the Central Excises and Salt Act, 1944 (hereafter referred to as the Excise Act), in which the petitioners were summoned by the Judicial Magistrate 1st Class, Jalandhar vide his order dated 27th September, 1982. Hence this petition under Section 482, Code of Criminal Procedure, against the aforesaid summoning order of the Magistrate.

2. In fact the complaint was filed against 13 persons, including the present petitioners, who were the directors of the company. One Raghubir Singh was the Manager of the company. The proceedings against the remaining directors were dropped as service could not be effected on them. In the complaint it was alleged that since there was no proper explanation for the shortage of 80 M.T. of steel ingots and the same might have been cleared from the company premises without paying excise duty, therefore, all the directors would be responsible and would be brought to justice for the offence of removing the aforesaid 80 M.T. of steel ingots without paying excise duty. But there is no specific allegation in the complaint against the present petitioners. No specific overt act is mentioned that they in any way removed the steel ingots from the premises of the company. Thus, the petitioners, in these circumstances, cannot be held liable in their capacity as directors of the company. The only allegation in the complaint is that Raghubir Singh, Manager of the company has not given any explanation as to how 80 M.T. of steel ingots were not there in the premises of the company and as to how 142.507 M.T. of steel ingots were in excess in the stock of Punjab Steel Rolling Mills, which is totally owned by the company. If at all, the allegation is only against Raghubir Singh, Manager and he being the Manager could be held responsible for any lapse under Section 9 of the Excise Act. But in the absence of any specific allegations against the directors of the company the petitioners being the directors could not be held liable. Their Lordships of the Supreme Court in Municipal Corporation of Delhi v. Ram Kishan Rohtagi-1983 SCC (Cri) 115, held as under :

'From the very nature of duties of the Manager of the company, it is manifest that he must be in the knowledge about the affairs of the sale and manufacture of the disputed sample. Therefore, a case was clearly made out against him and he was vicariously liable for the offence, vicarious liability being an incident of an offence under the Act. But as regards the directors, there was no evidence to show, apart from the presumption drawn by the complainant, that there is any Act committed by the directors from which a reasonable inference can be drawn that they could also be vicariously liable. In these circumstances, therefore, no case against the directors had been made out ex facie on the allegations made in the complaint and the proceedings against them were rightly quashed.'

3. The Calcutta High Court in Kedar Nath Goenka v. Superintendent of Central Excise, 1979 Cr. L.J. 421, also took the same view and on served as under :

'Where there was no averment that the directors of the company were guilty of any specific act of commission or commission which would tantamount to an offence, they could not be prosecuted under Section 9(1). Section 9C was also not attracted as the prosecution against the accused was illegal.'

4. That was also a complaint under Section 9(1) of the Central Excises and Salt Act.

5. The learned Counsel for the respondent, Mr. Brar, could not point out any authority taking a contrary view although time was given to him.

6. Accordingly, this petition is allowed and the impugned order dated 27th September, 1982 (annexure) is hereby quashed. However, it will be open to the respondent to proceed against the petitioner or any other director of the company, if some material against them is found.


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